Longtime Russell Gardens resident Ruth Kraft’s spent almost a decade as a civil frauds judge, deciding cases about employers accused of failing to pay employment taxes.
Now, as an attorney at Garden City-based Kirschenbaum & Kirschenbaum, P.C., she works the other side of the courthouse, advising businesses how to comply with what she describes as the complex employment laws set by the state.
“I felt like the challenge [of serving as a judge] was gone,” Kraft said. “I am very much a problem solver and a strategizer. As a judge, you get to solve problems but you don’t get to strategize too much.”
Kraft worked earlier in her career worked as a law professor at New York University before taking time off to care for her young children. When she returned to the labor force, she said, it was in the middle of a push to attract academics and law professionals of different backgrounds judgeships, which had typically been given to trial lawyers
“When I decided that I want to go back to work, it was very fortuitous that [former New York City] Mayor Giuliani was making appointments, and there was a move in the court system to try to create a more diverse judiciary,” Kraft said. “A friend of mine said you really should apply for a judgeship, so I did.”
Kraft was one of a small group of judges deciding employment tax cases, she said. Kraft and her colleagues had to measure the often thin grey line between employees and independent contractors – a distinction that meant big expenses for businesses that tried to skirt employment taxes.
“There are probably 20, 25 people who have been trained to do these cases,” she said.
The type of law Kraft practices, she said, is fulfilling both on an intellectual level in its complexity and because of its immediacy to the workers and businesses involved.
“It’s intellectually stimulating, and the other part of it that’s very special is the decisions that people make, and their feelings about the workplace are very personalized,” Kraft said. “If I told you you were fired, that becomes a very personal thing in your life.”
She described one notable case, where a venture capitalist had started a Web-based service to connect employees and workers as independent contractors – freeing those businesses from the need to pay taxes associated with formal employees.
But when one worker lost his position lost his position and filed for unemployment – a benefit reserved for those on company payrolls – the investor was suddenly put at unanticipated legal risk for taxation on labor of all the site’s users.
“The irony was, the plaintiff in the case was one little guy in his 20s who had no clue that by filing for unemployment he had opened pandora’s box for this company,” Kraft said.
And while some cases were driven by legal confusion, some were deliberately attempts to skirt the law – such as the case of a medical practice that counted its employees, including doctors, as independent contractors. That case took eight months to try, Kraft said.
“He had them all as independent contractors to avoid the employment tax,” she added.
Kraft lives with her husband Robert, a plastic surgeon, in Russell Gardens. She has two grown sons.
“I love it. It’s a lovely community, it really really is,” Kraft said.
